Travel Leisure Co. · NYSE:TNL
Travel Leisure — Q4 2024 Earnings Presentation
36 slides from Travel Leisure's earnings presentation, Feb 19, 2024
Slide 1: Investor Presentation
+ INVESTOR PRESENTATION Febrary 2025 MOUNT JEFFERSON, OR
Slide 2: Presentation of Financial Information; Forward-Looking Statements
Presentation of Financial Information Forward-Looking Statements Financial information discussed in this presentation includes non-GAAP measures This presentation includes “forward-looking statements” as that term is defined by such as Adjusted EBITDA, Adjusted EBITDA margin, Adjusted diluted EPS, A
Slide 3: Company Overview
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S WO R L D M A R K A R R OW P O I N T HARRISON, ID Company Overview 3
Slide 4: Travel + Leisure Co.: The Leader in Vacation Ownership
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Travel + Leisure Co.: The Leader in Vacation Ownership LEA DI NG THE • Industry has consolidated around large, branded-name companies T R A NS FORMATI ON OF THE
Slide 5: Travel + Leisure Co.: By the Numbers
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Travel + Leisure Co.: By the Numbers 270+ 3,600 809K Resorts Worldwide Affiliated RCI Resorts Timeshare Owners Q4’24 Q4’24 Q4’24 3.4M 19,000 391K Avg. Exchange
Slide 6: Vacation Ownership and Travel and Membership Overview and 2024 Financials
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S VA C AT I O N O W N E R S H I P T R AV E L A N D M E M B E R S H I P + Overview + Overview • Sales of vacation ownership interests •E xchange services for • Res
Slide 7: Consolidation + Product Evolution Driving Industry Transformation
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Consolidation + Product Evolution Driving Industry Transformation TO DAY: S CA L ED & P O I SED HISTORICAL FO R AC CEL ER ATED G R OW TH Fragmented, FO OTPR INT
Slide 8: Favorable Trends in the Business
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Favorable Trends in the Business + Secular Growth + Strong Owner + Attractive +G enerational In Travel Satisfaction Product Shift • Global leisure travel market
Slide 9: New Owner Sales Create Solid Foundation for Future Revenue Growth
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S New Owner Sales Create Solid Foundation for Future Revenue Growth STR ONG P IP EL I N E OF P OT ENT IAL M O R E TH A N 75% O F R EV EN U E S FUTURE REVENU E ( 1
Slide 10: Stable of Brands to Appeal to a Wide Range of Consumers
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Stable of Brands to Appeal to a Wide Range of Consumers Throughout the Stages of Their Lives PR OVEN BRANDS WITH EXPANDED B RAN DS IN BR ANDS GROWTH POTENTIAL D
Slide 11: Resilient Business with Strong Adjusted EBITDA Margins
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Resilient Business with Strong Adjusted EBITDA Margins Vacation Ownership Segment Adjusted EBITDA Margin (1) 30% 24% (2) 24% 24% 25% 23% 23% 22% 20% 16% 16% 15%
Slide 12: Consumer Financing Drives Substantial Earnings Stream
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Consumer Financing Drives Substantial Earnings Stream Weighted Average Interest Rate FICO(1) 800 18.0% 17.0% 736 736 739 744 735 725 726 16.0% 700 691 14.9% 15.
Slide 13: Disciplined Approach to Underwriting Has Improved Loan Portfolio
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Disciplined Approach to Underwriting Has Improved Relative Position of Loan Portfolio 12/31/2008 12/31/2019 12/31/2024 Weighted Avg. FICO 680 722 736 (At origin
Slide 14: Our Travel and Membership Business is Transforming
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Our Travel and Membership Business is Transforming T R AV E L EXC HA NGE T R AVEL CLU B S A N D ME MB E R S H IP • Pressure on volumes as industry has consolida
Slide 15: Disciplined and Balanced Capital Allocation Framework
COCM O PA M PA NY NY QU RAERST UELT RSLY R E S U LT S A D D I TAI D ODN IATLI OFNI N AAL NFCI N I AALN C I A L N O N -N GOAN A-P OV OEVREV RIV E IW EW AND AONUDTL OOUOTK LO O K I N F O RI N MF AT OR IOMNAT I O N R E C O N CGI L AIA ATPS IONS Disciplined and Balanced Capital Allocation Framework I NV
Slide 16: Shareholder-Focused Capital Allocation
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Shareholder-Focused Capital Allocation D IVI D E N D G ROWS S U B STANTIAL I N LI N E WITH B U S I N E S S S HAR E R E PU RC HAS E S CAPITAL I NVE STM E NTS 202
Slide 17: Cumulative Capital Returned to Shareholders Since Spin
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Cumulative Capital Returned to Shareholders Since Spin $2,512 $2,500 Repurchases Diluted Weighted Average Shares Outstanding Dividends $2,135 $2,000 99.2 92.4 $
Slide 18: Solid Balance Sheet with Manageable Debt Maturities
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Solid Balance Sheet with Manageable Debt Maturities C O RP O RATE D EBT M ATURITIE S (3) STATS As of December 31, 2024 ($ in millions) Revolving Credit Facility
Slide 19: Results and Outlook
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S W O R L D M A R K C A S C A D E LO D G E W H I S T L E R , B C C A N A DA Results and Outlook 19
Slide 20: 4Q and FY 2024 Results
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S 4Q and FY 2024 Results TH R E E M O NTH S E N D E D 1 2/3 1/2 0 2 4 Adj. Diluted Earnings Net Revenue Gross VOI Sales (1) Adj. EBITDA (1) Per Share (1) $971M $5
Slide 21: Adjusted EBITDA — 2023 v. 2024
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Adjusted EBITDA — 2023 v. 2024 (1) 223 (61) 929 908 (84) (2) (55) 2023 Gross VOI Sales(2) Revenue-related Loan loss Net interest Other 2024 costs(3) provision i
Slide 22: Utilizing a Proven Capital Allocation Framework
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Utilizing a Proven Capital Allocation Framework STR ONG CA SH SHAR EHOLD E R S O L ID GENERATI ON R ET U R N S BA L A N CE S H E E T ADJ U STED FR EE CA SH FLOW
Slide 23: Expectations for 2025
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Expectations for 2025 PR OVIDING P R OV ID IN G FIR ST QUART ER F UL L Y E A R GU IDANCE G UIDA N CE Q1 ‘ 2 5E 202 5E Adj. EBITDA (1) $195M–$205M $955M–$985M Gr
Slide 24: Additional Financial Information
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S WO R L D M A R K CA N M O R E - BA N F F C A N M O R E , A B C A N A DA Additional Financial Information 24
Slide 25: Model Sensitivities
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Model Sensitivities Three major drivers to performance in the Vacation Ownership segment Volume Tour Loan Loss Per Guest Growth Provision (VPG) Gross VOI sales
Slide 26: Adjusted EBITDA to Adjusted Free Cash Flow Conversion %
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S Adjusted EBITDA to Adjusted Free Cash Flow Conversion % 2024 Actuals 100% (26%) 48% (11%) (6%) (2%) (7%) Adj. EBITDA(1) Cash Interest Cash Taxes Net consumer Ne
Slide 27: C O M PA N Y OV E R V I E W Q
C O M PA N Y Q U A R T E R LY R E S U LT S ADDITIONAL FINANCIAL NON- OV E R V I E W A N D O U T LO O K I N F O R M AT I O N GAAPS 27
Slide 28: Appendix: Non-GAAP Reconciliations
APPENDIX: NON-GAAP R E C O N C I L I AT I O N S 28
Slide 29: Net Income to Adjusted EBITDA Reconciliation
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S A P P E N D I X : N O N - G A A P R E C O N C I L I AT I O N Travel + Leisure Co. Net Income to Adjusted EBITDA Reconciliation ($ in millions) 2024 2023 2022 20
Slide 30: Operating Cash Flow to Adjusted Free Cash Flow
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S A P P E N D I X : N O N - G A A P R E C O N C I L I AT I O N Net Cash Provided by Operating Activities from Continuing Operations to Adjusted Free Cash Flow ($
Slide 31: Vacation Ownership Net Income to Adjusted EBITDA
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S A P P E N D I X : N O N - G A A P R E C O N C I L I AT I O N Vacation Ownership Net Income to Adjusted EBITDA Reconciliation ($ in millions) 2024 2023 2022 2021
Slide 32: Travel and Membership Net Income to Adjusted EBITDA
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S A P P E N D I X : N O N - G A A P R E C O N C I L I AT I O N Travel and Membership Net Income to Adjusted EBITDA Reconciliation ($ in millions) 2024 TM net inco
Slide 33: Reconciliation of Net VOI Sales to Gross VOI Sales
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S A P P E N D I X : N O N - G A A P R E C O N C I L I AT I O N Reconciliation of Net VOI Sales to Gross VOI Sales ($ in millions) The Company believes gross VOI s
Slide 34: Net Income to Adjusted Net Income to Adjusted EBITDA
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S A P P E N D I X : N O N - G A A P R E C O N C I L I AT I O N Reconciliation of Net Income to Adjusted Net Income to Adjusted EBITDA ($ in millions except per sh
Slide 35: Operating Cash Flow to Adjusted Free Cash Flow Quarterly
C O M PA N Y R E S U LT S ADDITIONAL FINANCIAL NON-GAAP OV E R V I E W A N D O U T LO O K I N F O R M AT I O N R E C O N C I L I AT I O N S A P P E N D I X : N O N - G A A P R E C O N C I L I AT I O N Net Cash Provided by Operating Activities from Continuing Operations to Adj. Free Cash Flow ($ in m
Slide 36: Definitions
DEFINITIONS Adjusted Diluted Earnings per Share: A non-GAAP measure, defined by the Company as Adjusted net income divided Adjusted Net Income: A non-GAAP measure, defined by the Company as income from continuing operations by the diluted weighted average number of common shares. Adjusted Diluted Ea